Professional Electric Cutting Tools From Japan: Final Results of the Fifth Antidumping Duty Administrative Review and Revocation of the Antidumping Duty Order, in Part

DEPARTMENT OF COMMERCE

International Trade Administration

[A-588-823]

Professional Electric Cutting Tools From Japan: Final Results of

the Fifth Antidumping Duty Administrative Review and Revocation of the

Antidumping Duty Order, in Part

AGENCY: Import Administration, International Trade Administration, U.S.

Department of Commerce.

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SUMMARY: On August 10, 1999, the U.S. Department of Commerce published

in the Federal Register the preliminary results of the fifth

administrative review of the antidumping duty order on professional

electric cutting tools from Japan (64 FR 43346). This review covers

Makita Corporation Incorporated, a manufacturer and exporter of the

subject merchandise to the United States. The period of review is July

1, 1997, through June 30, 1998.

We gave interested parties an opportunity to comment on our

preliminary results. Our analysis of the comments received as well as

our discussion of the issues related to revocation of the antidumping

duty order are described below in the ``Revocation'' and ``Interested

Party Comments'' sections of this notice. After review of the comments,

we have not changed the preliminary results, including the

determination to revoke the antidumping duty order, in part, with

respect to professional electric cutting tools that are produced by

Makita Corporation Incorporated and that are also exported by Makita

Corporation Incorporated. The final results are listed below in the

section ``Final Results of Review.''

EFFECTIVE DATE: December 21, 1999.

FOR FURTHER INFORMATION CONTACT: Brian Ledgerwood at (202) 482-3836 or

Brian Smith at (202) 482-1766, Import Administration, International

Trade Administration, U.S. Department of Commerce, 14th Street and

Constitution Avenue, N.W., Washington, D.C. 20230.

SUPPLEMENTARY INFORMATION:

Background

On August 10, 1999, the U.S. Department of Commerce (``the

Department'') published in the Federal Register preliminary results of

the 1997-1998 administrative review of the antidumping duty order on

professional electric cutting tools (``PECTs'') from Japan (64 FR

43346) (``preliminary results'') and its preliminary intent to revoke

the antidumping duty order, in part, with respect to PECTs that are

produced by Makita Corporation Incorporated and that are also exported

by Makita Corporation Incorporated (``Makita Japan''). The period of

review (``POR'') for this administrative review is July 1, 1997,

through June 30, 1998.

The petitioner, Black & Decker (U.S.) Inc. (``Black & Decker''),

and respondent Makita Japan (along with Makita Japan's affiliated

selling agent in the United States, Makita U.S.A. Inc. (``Makita

USA'')), requested a hearing in this case on September 9, 1999. The

petitioner and Makita Japan/Makita USA (hereafter collectively

referenced as ``Makita'') submitted case briefs and rebuttal briefs on

September 10, 1999 and September 17, 1999, respectively. On October 8,

1999, based on the petitioner's and Makita's timely requests, the

Department conducted a public hearing. Also, based on the petitioner's

timely request, the Department conducted a non-public hearing in which

counsel for the interested parties discussed proprietary information

protected under an administrative protective order (``APO'').

The Department has now completed this administrative review, in

accordance with section 751(a) of the Act.

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Tariff Act of 1930 (``the Act'') by

the Uruguay Round Agreements Act (``URAA''). In addition, unless

otherwise indicated, all references to regulation are to the

Department's regulations at 19 CFR Part 351 (1998).

Scope of Review

Imports covered by this review are shipments of PECTs from Japan.

PECTs may be assembled or unassembled, and corded or cordless.

The term ``electric'' encompasses electro-mechanical devices,

including tools with electronic variable speed features. The term

``assembled'' includes unfinished or incomplete articles, which have

the essential characteristics of the finished or complete tool. The

term ``unassembled'' means components which, when taken as a whole, can

be converted into the finished or unfinished or incomplete tool through

simple assembly operations (e.g., kits).

PECTs have blades or other cutting devices used for cutting wood,

metal, and other materials. PECTs include chop saws, circular saws, jig

saws, reciprocating saws, miter saws, portable bank saws, cut-off

machines, shears, nibblers, planers, routers, joiners, jointers, metal

cutting saws, and similar cutting tools.

The products subject to this order include all hand-held PECTs and

certain bench-top, hand-operated PECTs. Hand-operated tools are

designed so that only the functional or moving part is held and moved

by hand while in use, the whole being designed to rest on a table top,

bench, or other surface. Bench-top tools are small stationary tools

that can be mounted or placed on a table or bench. These are generally

distinguishable from other stationary tools by size and ease of

movement.

The scope of the PECTs order includes only the following bench-top,

hand-operated tools: cut-off saws; PVC saws; chop saws; cut-off

machines, currently classifiable under subheading 8461 of the

Harmonized Tariff Schedule of the United States (``HTSUS''); all types

of miter saws, including slide compound miter saws and compound miter

saws, currently classifiable under subheading 8465 of the HTSUS; and

portable band saws with detachable bases, also currently classifiable

under subheading 8465 of the HTSUS.

This order does not include: professional sanding/grinding tools;

professional electric drilling/fastening tools; lawn and garden tools;

heat guns; paint and wallpaper strippers; and chain saws, currently

classifiable under subheading 8508 of the HTSUS.

[[Page 71412]]

Parts or components of PECTs when they are imported as kits, or as

accessories imported together with covered tools, are included within

the scope of this order.

``Corded'' and ``cordless'' PECTs are included within the scope of

this order. ``Corded'' PECTs, which are driven by electric current

passed through a power cord, are, for purposes of this order, defined

as power tools which have at least five of the following seven

characteristics:

1. The predominate use of ball, needle, or roller bearings (i.e., a

majority or greater number of the bearings in the tool are ball,

needle, or roller bearings);

2. Helical, spiral bevel, or worm gearing;

3. Rubber (or some equivalent material which meets UL's

specifications S or SJ) jacketed power supply cord with a length of 8

feet or more;

4. Power supply cord with a separate cord protector;

5. Externally accessible motor brushes;

6. The predominate use of heat treated transmission parts (i.e., a

majority or greater number of the transmission parts in the tool are

heat treated); and

7. The presence of more than one coil per slot armature.

If only six of the above seven characteristics are applicable to a

particular ``corded'' tool, then that tool must have at least four of

the six characteristics to be considered a ``corded'' PECT.

``Cordless'' PECTs, for the purposes of this order, consist of

those cordless electric power tools having a voltage greater than 7.2

volts and a battery recharge time of one hour or less.

PECTs are currently classifiable under the following subheadings of

the HTSUS: 8508.20.00.20, 8508.20.00.70, 8508.20.00.90, 8461.50.00.20,

8465.91.00.35, 85.80.00.55, 8508.80.00.65 and 8508.80.00.90. Although

the HTSUS subheading is provided for convenience and customs purposes,

the written description of the merchandise under review is dispositive.

Duty Absorption

On September 24, 1998, the petitioner requested that the Department

determine whether antidumping duties had been absorbed during the POR.

Section 751(a)(4) of the Act provides for the Department, if requested,

to determine during an administrative review initiated two or four

years after the publication of the order, whether antidumping duties

have been absorbed by a foreign producer or exporter, if the subject

merchandise is sold in the United States through an affiliated

importer. In this case Makita Japan sold to the United States through

an importer (i.e., Makita USA) that is affiliated within the meaning of

section 751(a)(4) of the Act.

Section 351.213(j)(2) of the Department's regulations provides that

for transition orders (i.e., orders in effect on January 1, 1995), the

Department will conduct duty absorption reviews, if requested, for

administrative reviews initiated in 1996 or 1998. Because the order

underlying this review was issued prior to January 1, 1995, and this

review was initiated in 1998, a duty absorption determination in this

segment of the proceeding is appropriate. As we have found that there

is no dumping margin for Makita with respect to its U.S. sales, we have

also found that there is no duty absorption for purposes of the final

results (see Final Results of Antidumping Duty Administrative Review:

Certain Hot-Rolled Lead and Bismuth Carbon Steel Products from Germany,

64 FR 43146 (August 9, 1999).).

Normal Value Comparisons

We made normal value (``NV'') comparisons to constructed export

price based on the same methodology used in the preliminary results

(see preliminary results at 43348-43350, and Preliminary Results

Calculation Memorandum to the File dated August 3, 1999).

Determination to Revoke Order in Part

The Department ``may revoke, in whole or in part,'' an antidumping

duty order upon completion of a review under section 751 of the Act.

While Congress has not specified the procedures that the Department

must follow in revoking an order, the Department has developed a

procedure for revocation that is described in 19 CFR 351.222. This

regulation requires, inter alia, that a company requesting revocation

must submit the following: (1) A certification that the company has

sold the subject merchandise at not less than NV in the current review

period and that the company will not sell at less than NV in the

future; (2) a certification that the company sold the subject

merchandise in each of the three years forming the basis of the request

in commercial quantities; and (3) an agreement to reinstatement of the

order if the Department concludes that the company, subsequent to the

revocation, sold subject merchandise at less than NV. (See 19 CFR

351.222(e)(1).) Upon receipt of such a request, the Department may

revoke an order, in part, if it concludes that: (1) The company in

question has sold subject merchandise at not less than NV for a period

of at least three consecutive years; (2) it is not likely that the

company will in the future sell the subject merchandise at less than

NV; and (3) the company has agreed to immediate reinstatement of the

order if the Department concludes that the company, subsequent to the

revocation, sold subject merchandise at less than NV. See 19 CFR

351.222(b)(2); see, e.g., Final Results of Antidumping Duty

Administrative Review and Determination Not To Revoke Order in Part:

Pure Magnesium from Canada, 64 FR 12977, 12978 (March 16, 1999) (``Pure

Magnesium from Canada'').

In our preliminary results, we found that Makita met the

requirements for revocation (see preliminary results, 64 FR 43351,

43352).

The petitioner argues that revocation is not appropriate because it

is likely that Makita will resume selling subject merchandise below NV

if the order is revoked. In general, the petitioner argues that Makita

has avoided dumping margins in the past by drastically reducing its

import volumes, and that Makita's pricing practices and loss in market

share indicate that Makita is not able to compete effectively in the

U.S. market without lowering prices. Additionally, the petitioner

argues that Makita could easily expand its production capacity in Japan

in order to begin selling at below NV in the future. Furthermore, the

petitioner argues that market demand in Japan is declining, thereby

increasing Makita's dependance on the U.S. market.

In response, Makita argues that its sales have in fact been in

commercial quantities, and that the record clearly indicates that it is

not likely that Makita will sell at below NV in the future if the order

is revoked. Makita argues that it has experienced a drastic change in

circumstance as a result of the building of its U.S. manufacturing

facility, where a majority of Makita's electric cutting tools for the

U.S. market are now produced. Thus, Makita stresses, most of its

production of ``subject merchandise'' occurs in the United States, and

consequently such products are no longer subject to the antidumping

duty order. Makita notes that it has made and continues to make

substantial investment in the U.S. facility, and that maintaining the

U.S. facility is consistent with the company's objective of producing

in close proximity to its customers. Furthermore, Makita states that,

while it has additional capacity in its U.S. production facility, it

has limited remaining production capacity in its facilities in Japan.

As such, Makita

[[Page 71413]]

claims that it is not likely that Makita would ever shift production of

its power tools back to Japan.

With regard to the market conditions and pricing levels, Makita

argues that it has no need to sell at below NV, because the U.S.

electric power tool market in general and electric cutting tool market

in particular are healthy, stable, and growing, and the Japanese

electric power tool market is also relatively stable. Makita further

argues that it is able to charge premium prices because of its

reputation for quality. Thus, Makita contends, it can make sales in the

U.S. market, even when its prices are higher than its competitors'

prices.

Upon review of the three criteria outlined at section 351.222(b) of

the Department's regulations, the comments of the parties, and all of

the evidence in the record, we have determined that the Department's

requirements for revocation have been met. Based on the final results

in this review and the final results of the two preceding reviews,

Makita has demonstrated three consecutive years of sales at not less

than NV. Furthermore, we find that Makita's aggregate sales to the

United States have been made in commercial quantities during each of

those years. Finally, based on our review of the record and the

comments of the parties, we continue to find that it is not likely that

Makita will sell at below NV in the future for the reasons set forth in

the August 2, 1999, Revocation Memorandum (see Memorandum Regarding

Revocation of the Antidumping Duty Order on Professional Electric

Cutting Tools from Japan dated August 2, 1999 (hereafter ``August 2

Revocation Memorandum'').

Although, Makita's sales to the United States have decreased

substantially since the imposition of the antidumping order, its

exports of subject merchandise to the United States, in particular

specialty PECTs, remain significant and reflect Makita's normal

commercial practice. Further, while Makita has maintained consistent

export volumes of its ``specialty'' PECTs, Makita transferred

production of the remaining subject merchandise (i.e., non-specialty

PECTs) to the United States. Makita made a substantial investment in a

U.S. manufacturing facility, and subsequently shifted production of

subject merchandise to that facility. Additionally, the record

indicates that the U.S. production facility now manufactures comparable

volumes of non-specialty merchandise to those previously manufactured

by Makita Japan. This significant change in business practice explains

the decrease in Makita's exports of subject merchandise to the United

States. With respect to products produced in Japan (i.e., specialty

PECTs), Makita has maintained consistent, significant levels of export

sales levels to hundreds of U.S. customers since 1995 (see August 2

Revocation Memorandum at Attachment 2, Makita's October 26, 1998,

section C response at Appendix C-2, and ``Commercial Quantities''

section below). Based on these facts (confirmed at verification) and

our review of Makita Japan's sales practices, we find that we can

reasonably conclude that the de minimis margins calculated for Makita

are reflective of the company's normal commercial experience and

provide a reasonable basis for our decision on revocation. See August 2

Revocation Memorandum at 10-11; and Pure Magnesium from Canada 64 FR

12977, 12979 (March 16, 1999) (where the Department found that because

sales and volume figures were so small, both in absolute terms and in

comparison with the period of investigation (``POI''), it could not

conclude that the reviews were reflective of what the company's normal

commercial experience would be without the discipline of an antidumping

duty order).

Additionally, after consideration of the various comments that were

submitted in response to the preliminary results, the Department

continues to find that because Makita is not likely to sell subject

merchandise in the United States below NV in the future, the continued

application of the antidumping duty order is no longer necessary to

offset dumping. As we stated in Brass Sheet and Strip from Germany,

Final Results of Antidumping Administrative Review and Determination to

Revoke in Part, 61 FR 49727, 49730 (September 23, 1996), ``[i]n prior

cases where revocation was under consideration and the likelihood of

resumption of dumped sales was at issue, the Department has considered,

in addition to the respondent's prices and margins in the preceding

periods, such other factors as conditions and trends in the domestic

and home market industries, currency movements, and the ability of the

foreign entity to compete in the U.S. marketplace without LTFV sales.''

See also Brass Sheet and Strip from Canada: Preliminary Results of

Antidumping Duty Administrative Review and Notice of Intent to Revoke

Order in Part, 63 FR 6519, 6523 (February 9, 1998).

Based upon the relevant factors in this case, we find that it is

not likely that Makita will sell at less than NV if the order is

revoked with respect to Makita and, therefore, the continued

application of the antidumping duty order to Makita is no longer

necessary to offset dumping. First, with regard to capacity

utilization, the record establishes that Makita Japan has very limited

remaining capacity in its Japanese facilities, while it has additional

remaining capacity at Makita Corporation of America (``MCA''). Makita

has made significant investments in its U.S. facility, and all evidence

in the record indicates that MCA intends to produce PECTs in the United

States for the long-term. The majority of the PECTs sold by Makita USA

are now being produced in the United States. Moreover, as confirmed at

verification, Makita has never shifted production of any tool from MCA

back to Japan. Additionally, Makita Japan is currently producing only

specialty PECTs for export to the U.S. market, and Makita Japan's

existing production in Japan is primarily geared toward production for

the home market. Furthermore, the record indicates that Makita Japan

produces specialty PECTs to order and thus maintains low inventories of

subject merchandise, another fact suggesting that Makita would be less

likely to dump subject merchandise.

Second, with respect to specialty tools (imports from Makita

Japan), Makita has consistently priced its products higher than its

competition in the United States. Thus, the record indicates that

Makita has not needed to lower prices of its Japan-produced tools in

order to remain competitive or to maintain a consistent level of sales

(i.e., quantity). Although Makita has lost U.S. market share in recent

years, it has maintained consistent annual sales in significant

quantities.

Third, the record indicates that the electric power tool industry,

including PECTs, in the United States and around the world is stable

and/or growing (see August 2 Revocation Memorandum at 14-15). Based on

our review of the record data, we found that this price stability

characteristic of the electric power tool industry mitigates against

the possibility of future dumping, as compared to other industries

where market prices are volatile (see the Department's July 9, 1999,

verification report at 34-39; the Department's July 13, 1999,

verification report at 13-15; the August 2 Revocation Memorandum at 14-

15).

Therefore, for the reasons discussed above and in our August 2

Revocation Memorandum at 11-15, we find that Makita Japan qualifies for

revocation of the order on PECTs which it produces and exports to the

United States under 19 CFR 351.222(e)(1)(ii).

[[Page 71414]]

We note that in response to the decision by a WTO Panel, the

Department revised its revocation regulation. See United States--Anti-

Dumping Duty on Dynamic Random Access Memory Semiconductors of One

Megabit or Above From Korea, WTO Doc. WT/DS99/R (January 29, 1999). The

new regulation replaces the ``not likely'' standard with a requirement

that ``[t]he continued application of the antidumping duty order is no

longer necessary to offset dumping'' now codified at 19 CFR 351.222(b).

While this regulation was not yet in effect for purposes of this

review, and thus does not apply to this case, we determine, as

discussed above and in the comments outlined below, that continuation

of the order with respect to Makita is no longer necessary to offset

dumping.

Interested Party Comments

General

Comment 1: The Department's Grant of Constructed Export Price Offset

Makita argues that the Department's grant of a constructed export

price (``CEP'') offset is in accordance with the law. Makita notes that

because the petitioner stipulated to dismissal of its judicial

challenge to the Department's grant of the CEP offset in the prior

fourth antidumping duty administrative review, it may be assumed that

the petitioner is no longer interested in pursuing the CEP offset issue

for purposes of the current proceeding.

In response, the petitioner asserted that, although it stipulated

to dismissal of prior litigation on this issue, it reserves its right

to appeal the issue if and when it is finally resolved.

Department's Position: We agree with Makita that the Department's

calculation of a de minimis margin, in particular the grant of a CEP

offset as part of the level of trade (``LOT'') analysis, is in

accordance with the U.S. antidumping law. As we explained in the final

results for the previous fourth antidumping duty administrative review:

The Department is continuing its practice, articulated in

section 351.412(c) of its regulations, of making LOT comparisons for

CEP sales on the basis of the CEP after adjustments provided for in

section 772(d) of the statute. As stated in Certain Stainless Steel

Wire Rods from France: Final Results of Antidumping Duty

Administrative Review, 63 FR 30185 (June 3, 1998), we recognize that

the Department's practice has been criticized by the CIT in Borden,

Inc. v. United States. However, the decision in Borden, Inc. v.

United States, is not final, and we believe our practice to be in

full compliance with the statute and the regulations. Thus, we will

continue to apply the methodology articulated in the regulations at

section 351.412. Professional Electric Cutting Tools from Japan

Final Results of the Administrative Review, 63 FR 54441 at 54444

(October 9, 1998) (Comment 2)

Accordingly, we have applied the methodology articulated in the

regulations at section 351.412.

Comment 2: Criteria for Revocation Set Forth in the Department's

Regulations

Makita argues that it has met the criteria for revocation set forth

in the Department's regulations. Specifically, Makita states that: (1)

It has made sales of subject merchandise for three consecutive years

(i.e., three PORs) at de minimis antidumping duty margins; (2) it

agrees to reinstatement of the antidumping duty order (should dumping

of subject merchandise resume) and has provided the requisite

certifications set forth in the Department's regulations (see

preliminary results, ``Intent To Revoke'' section, 63 FR at 43350

(August 10, 1999)); (3) it has made sales of subject merchandise in

commercial quantities (see ``Commercial Quantities'' section below for

further discussion); and (4) there is no likelihood that Makita will in

the future sell the subject merchandise at less than NV (see

``Likelihood of Future Dumping'' section below for further discussion).

Therefore, based on its fulfilment of the criteria outlined above,

Makita argues that the Department should revoke the order with respect

to PECTs that are produced by Makita Japan and that are also exported

by Makita Japan.

The petitioner argues that Makita has not met the criteria for

revocation set forth in the Department's regulations. Specifically, the

petitioner states that: (1) Makita's sales of subject merchandise have

not been in commercial quantities; and (2) Makita has not presented any

compelling argument demonstrating that it is not likely to dump subject

merchandise in the future.

Department's Position: We agree with Makita that it has met the

Department's criteria for revocation set forth in its regulations.

Specifically, Makita has met the following requirements: (1) Makita has

made sales of subject merchandise for three consecutive years (i.e.,

three PORs) at de minimis dumping margins; (2) Makita agrees to

reinstatement of the antidumping duty order (should dumping of subject

merchandise resume) and has provided the requisite certifications set

forth in the Department's regulations (see preliminary results;

``Intent To Revoke'' section, 63 FR at 43350). In addition, we have

determined that Makita has made sales of subject merchandise in

commercial quantities (see ``Commercial Quantities'' section below for

detailed discussion) in each of the three years of de minimis margins.

Finally, we find that it is not likely that Makita will in the future

sell the subject merchandise at less than NV (see ``Likelihood of

Future Dumping'' section below for detailed discussion), and that the

continued application of the antidumping duty order is no longer

necessary to offset dumping. Therefore, the Department is revoking the

order with respect to PECTs from Japan that are produced by Makita

Japan and that are also exported by Makita Japan.

Commercial Quantities

Comment 1: Standard for Determining Whether Sales are Made in

Commercial Quantities

The petitioner states that Makita has not met the threshold

requirement of demonstrating that sales of subject merchandise were

made in commercial quantities during the three PORs under review (i.e.,

3rd Administrative Review: 7/1/95-6/30/96, 4th Administrative Review:

7/1/96-6/30/97, and 5th Administrative Review: 7/1/97-6/30/98--

hereafter ``3rd AR,'' ``4th AR,'' and ``5th AR''). The petitioner

argues that Makita's sales during the three years under review are not

representative of its normal commercial behavior, as is demonstrated by

the disparity between pre-order and post-order subject merchandise

sales volumes. The petitioner asserts that the Department is applying

an incorrect standard by ignoring the disparity in pre-order and post-

order sales volumes and is setting bad policy by finding sales in

commercial quantities under the facts of this case. Specifically, the

petitioner states that, consistent with prior determinations on

revocation, the Department must consider both absolute and relative

current sales volumes (i.e., post-order) in comparison to respondent's

sales volumes prior to the order, because sales volumes subsequent to

the order are meaningless without a pre-order benchmark. Thus, the

petitioner claims that the Department erred in its preliminary results

by considering sales volume only in absolute terms for determining

whether sales were made in commercial quantities.

The petitioner argues that the Department's case history on

commercial quantities determinations in the context of revocation has

focused on absolute and relative sales volumes between the pre- and

post-order periods. To support its argument, the petitioner

[[Page 71415]]

cites to cases where the respondent had zero or very few sales in

absolute terms and the Department found that it did not meet the

commercial quantities threshold (see, e.g., Pure Magnesium from Canada,

64 FR 12978 (March 16, 1999), and Certain Corrosion-Resistant Carbon

Steel Flat Products and Certain Cut-to-Length Carbon Steel Plate from

Canada: Final Results of Antidumping Duty Administrative Review and

Determination to Revoke in Part, 64 FR 2173, 2175 (January 13, 1999)

(hereafter ``Corrosion-Resistant Steel from Canada''). The petitioner

also cites to a case where respondent had 35, 45, and 70 percent of its

pre-order relative sales volumes during the three consecutive PORs

without dumping and the Department concluded that these sales volumes

met the commercial quantities threshold (i.e., Silicon Metal from

Brazil: Preliminary Results, Intent to Revoke in Part, Partial

Rescission of Antidumping Duty Administrative Review, and Extension of

Time Limits, 64 FR 43161, 43162 (August 9, 1999) (hereafter ``Silicon

Metal from Brazil'')). The petitioner states that although Makita had

more than a few sales in absolute terms, Makita's sales history is not

analogous to Silicon Metal from Brazil case cited above. Therefore, as

a matter of policy, as a matter of consistency, and due to the

importance of the comparative standard used in determining normal

commercial activities, the petitioner maintains that Makita's sales

volumes cannot be considered satisfactory.

The petitioner disagrees with the Department's finding in the

preliminary results that, ``[a]lthough Makita's sales to the United

States have decreased substantially since the imposition of the

antidumping order, its exports to the United States remain significant.

* * * Thus regardless of the decrease in shipments during the course of

this proceeding, * * * Makita is currently selling in commercial

quantities.'' (See August 2 Revocation Memorandum at 10.) Specifically,

the petitioner claims that sales volume during the POI must be

considered when ascertaining whether the company's current sales

reflect normal commercial practice, because the POI provides the only

time period for which there is evidence concerning the respondent's

commercial behavior without the discipline of the antidumping duty

order. Citing Certain Corrosion-Resistant Carbon Steel Flat Products

and Certain Cut-to-Length Carbon Steel Plate from Canada: Preliminary

Results of Antidumping Duty Administrative Reviews, Intent to Revoke in

Part, Intent to Not Revoke in Part, and Rescission of Review in Part,

64 FR 45228, 45230 (August 19, 1999) (hereafter ``Corrosion-Resistant

Carbon Steel Flat Products from Canada'') (where the Department found

that sales were not in commercial quantities when the respondent's

sales volumes for the current POR were only 0.173 percent of the POI

sales volumes); and Pure Magnesium from Canada, 64 FR 12977, 12982

(March 16, 1999) (where the volume of subject merchandise sales sold in

each year under review was less than 0.5 percent of the volume sold

prior to the imposition of the order). Thus, the petitioner claims that

because the volume of Makita's subject merchandise sales sold in each

year under review was one percent or less than the volume sold prior to

the imposition of the order, the Department cannot reasonably conclude

that the consecutive de minimis margins are reflective of Makita's

normal commercial experience in this case. Additionally, the petitioner

argues that the Department cannot declare an amount to be

``significant'' (i.e., current sales volume) without having some

comparison or benchmark to provide context; in other words,

``significant'' must be relative to some defensible benchmark (See

Shakeproof Assembly Components v. United States, Slip Op. 99-70 at 6

(CIT July 29, 1999) and Taiwan Semiconductor Industry Ass'n v. United

States, Slip Op. 99-57 at 18 (CIT June 30, 1999).)

Additionally, the petitioner maintains that Makita's current sales

activity (post-order) does not reflect the company's normal commercial

activity (pre-order), because Makita's recent exports to the United

States consist only of low-sales-volume, ``specialty'' PECT models

(i.e., not high-sales-volume, non-specialty PECT models), which are

sold at relatively high prices. The petitioner argues that Makita's

pre-order subject merchandise exports represented a full range of PECT

models sold in significant quantities, rather than just ``specialty''

PECT models. Thus, the petitioner argues that Makita's post-order

``specialty'' PECT sales are not reflective of the company's normal

pre-order commercial activity. The petitioner further contends that

Makita's total number of PECT sales dropped considerably while Makita's

sales of other non-subject power tools (i.e., drills, sanders, and

grinders) remained consistent, thus indicating that Makita's current

sales of subject merchandise are not reflective of its normal

commercial activity.

Makita states that its sales from the 3rd through the 5th ARs

represent Makita's normal commercial behavior and reflect significant,

consistent sales volumes. In addition, Makita argues that its current

sales volumes continue to exhibit substantially the same range of

specialty PECTs that were exported in 1992, prior to the imposition of

the antidumping duty order, and that nothing has changed in regard to

its specialty PECT exports.

Furthermore, Makita argues that it is not necessary to rely on pre-

order sales volumes in this case in order to ascertain Makita's normal

commercial practice, emphasizing that the Department cannot ignore the

fact that Makita has established a permanent U.S. production facility

that now manufactures the majority of Makita's PECT production for the

U.S. market. Thus, Makita asserts, the subject merchandise that was

previously produced in Makita's facility in Japan (pre-order) is now

being manufactured in the United States. As a consequence of this

substantial and permanent change in the company's business practice,

which occurred in 1993, Makita stresses that pre-order export levels

cannot properly represent current commercial activity.

Makita further notes that because it has permanently shifted the

production of its high-sales-volume, ``non-specialty'' PECTs from

Makita Japan to its U.S. production facility (i.e., MCA)), it is

unlikely that Makita will ever again achieve 1992 pre-order sales

quantities of PECTs that are produced in Japan. Thus, Makita argues

that if the Department were to apply the petitioner's suggested

requirement for commercial quantities, Makita could never obtain a

revocation of the order. In effect, Makita argues, no company that

shifts its production to the United States would ever be able to seek

revocation. Makita further argues that the Department has considerable

discretion in determining whether sales were made in commercial

quantities and that the Department's preliminary finding in this case

was in fact consistent with another recent decision issued by the

Department. Citing Notice of Preliminary Results of Antidumping

Administrative Review and Intent to Revoke Order in Brass Sheet and

Strip from the Netherlands, 64 FR 48760, 48765, (September 8, 1999)

(hereafter ``Brass Strip from the Netherlands''), Makita states that

its change in commercial practice is similar to the circumstances in

that case, where the respondent acquired a U.S. production facility and

shifted significant production to the United States. Makita notes that,

in Brass Strip from the Netherlands, the Department determined that the

respondent's U.S.

[[Page 71416]]

sales were made in commercial quantities, despite a decline in exports,

based on the Department's finding that the acquisition of the U.S.

facility represented an ``unusual occurrence'' that significantly

altered the company's commercial practice. Makita further argues that,

in Brass Strip from the Netherlands, the Department stated that it is

reasonable to conclude that the company's commercial practices were

permanently changed when its subject merchandise production shifted to

its U.S. facility, thereby making the date of the production shift,

rather than the pre-order period, the appropriate benchmark for

measuring whether respondent's sales during the three years without

dumping were made in commercial quantities.

Makita stresses that it is not necessary to consider pre-order

sales volumes, if the more current data provides the Department with

appropriate information for determining Makita's normal commercial

behavior. Makita argues that the Department's practice regarding the

determination of commercial quantities must be applied on a case-by-

case basis and that there are no set guidelines, commercial standards,

or policies setting forth precise minimum sales quantities or

permissible percentage changes in those quantities that are needed to

determine a respondent's normal commercial behavior. Makita argues that

this case is different from the cases cited by the petitioner (i.e.,

Pure Magnesium from Canada, Corrosion-Resistant Steel from Canada,

Corrosion-Resistant Carbon Steel Flat Products from Canada, and Silicon

Metal from Brazil), noting that none of the cases cited involved a

major shift in production of subject merchandise. Additionally, Makita

argues that the petitioner's citation to Shakeproof Assembly Components

v. United States and Taiwan Semiconductor Industry Ass'n v. United

States is not persuasive because those cases involved decisions by the

International Trade Commission (``ITC''), rather than the Department of

Commerce.

Makita also argues that there is a sound basis on which to evaluate

what the Department means when it uses the term ``significant'' with

respect to Makita's volume of export sales to the United States in this

review. Specifically, Makita notes that by defining the relevant

universe of subject merchandise imports as specialty PECTs only, then

its sales of the 16 specialty PECTs in the post-order period have

unquestionably been consistent and significant in relation to pre-order

sales of the same 16 models.

Finally, in response to the petitioner's argument that the

Department should decide this case in a manner consistent with other

revocation cases, Makita states that this is precisely what the

Department did, i.e., the Department based its decision on Makita's

normal commercial practices. Makita argues that if the Department could

not consider a significant and long-term change in business practice

(i.e., shifting high-volume PECT production to a U.S. production

facility (MCA)), Makita would forever be locked into the order.

According to Makita, any changes in the way Makita did business that

resulted in lower volumes of imports would result in an indefinite

continuation of the order, thereby rendering the revocation provision

meaningless for Makita.

Department's Position: We agree with the petitioner that in order

to form the basis for a revocation determination, past margins must be

reflective of the company's normal commercial activity. See Corrosion-

Resistant Steel from Canada. Sales during a POR which, in the

aggregate, are of an abnormally small quantity do not generally provide

a reasonable basis for determining that the discipline of the order is

no longer necessary to offset dumping. Id.; see also Pure Magnesium

from Canada at 12979 (``These sales and volume figures are so small,

both in absolute terms and in comparison with the period of

investigation, that we cannot reasonably conclude that the zero margins

[respondent] received are reflective of the company's normal commercial

experience.''). However, the determination as to whether or not sales

volumes are made in commercial quantities is made on a case-by-case

basis, based on the unique facts of each proceeding. Neither the

statute nor the regulations prescribes a specific standard for

determining whether sales have been made in commercial quantities. For

example, we have specifically found in prior cases that although one or

two sales is not generally sufficient to meet the threshold, a sales

drop-off after the imposition of an antidumping duty order does not

necessarily prevent revocation (see, e.g., Pure Magnesium From Canada;

Final Results of Antidumping Duty Administrative Review and

Determination Not to Revoke Order in Part 64 FR 50489, 50490-Comment 1,

50492-Comment 4 (September 17, 1999) (hereafter ``Pure Magnesium from

Canada 2'') (where one or two sales was not consistent with normal

commercial practice; also stating that a sales drop-off after

imposition of the order does not necessarily prevent revocation). See

also Corrosion-Resistant Steel from Canada (although one sale during

the POR was insufficient, several thousand sales during another POR was

distinguishable); and Brass Strip from the Netherlands, 64 FR 48760,

48765 (September 8, 1999) (respondent provided a commercially

acceptable explanation of why exports of subject merchandise had

declined).

In this case, we agree with Makita that its sales volumes during

each of the three years under consideration were significant. Unlike in

prior cases where the Department did not revoke because the respondent

did not meet the basic threshold requirement of sales made in

commercial quantities, in this case, Makita made thousands of sales

during each POR to hundreds of different customers (see August 2

Revocation Memorandum at Attachment 2 and Makita's October 26, 1998

section C response at Appendix C-2). Compare Corrosion-Resistant Steel

from Canada (sales were not in commercial quantities where respondent

only had one sale during the POR); Pure Magnesium from Canada (sales

were not in commercial quantities where respondent had one sale in two

of the relevant years and two sales in the other). Thus, this case is

distinguishable from other cases where the respondents only had one or

two sales during the relevant PORs. Moreover, although Makita's

aggregate subject merchandise PECT sales have decreased since the

imposition of the antidumping order, that decrease relates to products

that Makita now produces in the United States. Makita continues to

export from Japan significant quantities of ``specialty'' PECTs, the

only PECT models not produced in the United States, and these

quantities are significant relative to pre-order (1992) sales of the

same models.1

---------------------------------------------------------------------------

\1\ Makita's history of specialty PECT sales is as follows:

Makita's 1993 sales of specialty PECTs were 00.00% of its 1992 sales

of specialty PECTs. Makita's 1994 sales of specialty PECTs were

38.39% of its 1992 sales of specialty PECTs. Makita's 1995 sales of

specialty PECTs were 38.60% of its 1992 sales of specialty PECTs.

Makita's 1996 sales of specialty PECTs were 47.18% of its 1992 sales

of specialty PECTs. Makita's 1997 sales of specialty PECTs were

42.17% of its 1992 sales of specialty PECTs. Makita's 1998 sales of

specialty PECTs were 50.86% of its 1992 sales of specialty PECTs.

(See August 2 Revocation Memorandum at Attachment 2).

---------------------------------------------------------------------------

Furthermore, sales during the three years in question are

reflective of the company's normal commercial experience since the

establishment of its production facility in the United States. The

record indicates that the U.S. production facility now manufactures

volumes of merchandise comparable to

[[Page 71417]]

what was previously being manufactured by Makita Japan. This

significant change in business practice provides a logical commercial

explanation for Makita's relative drop in subject merchandise sales.

In the preliminary results of Brass Strip from the Netherlands, we

evaluated whether the volume of sales prior to the order was the proper

benchmark for measuring whether a respondent's sales volumes during the

three years without dumping were made in commercial quantities, where

the respondent acquired a U.S. manufacturing facility (subsequent to

the imposition of the order) and had shifted a substantial portion of

its production of subject merchandise to the United States. In Brass

Strip from the Netherlands at 48765-48766, we found that this ``unusual

occurrence'' provided sufficient reason to re-evaluate the benchmark.

We stated:

Although both the quantity and number of [respondent]'s

shipments to the United States of subject merchandise have decreased

since the imposition of the antidumping duty order, we find that the

. . . acquisition of [the U.S. facility] and the subsequent transfer

of in-scope radiator strip production to the United States is

reflective of the type of ``unusual occurrence'' contemplated by the

Department, in promulgating its regulations, as an acceptable

explanation of why exports of subject merchandise have declined.

Prior to this acquisition, . . . [respondent] continued to ship in

similar quantities to the pre-order period and the subsequent

cessation of shipments until 1995 was the immediate result of the

1991 acquisition. Based upon these circumstances, it is reasonable

to conclude that the company's commercial practices were permanently

changed in 1991, and that 1991, rather than the pre-order period,

should be the benchmark for measuring whether the company's sales

during the three years without dumping were made in commercial

quantities.

Thus, as indicated in Brass Strip from the Netherlands, in order to

ascertain a corporation's ``normal commercial practice'' with respect

to shipment volumes, where necessary, we will evaluate the most

appropriate benchmark. We recognize that in most cases, sales of

subject merchandise sold prior to the imposition of the order will

provide the most relevant benchmark. However, in unusual instances,

such as those in this case, flexibility may be warranted in order to

properly evaluate the company's normal commercial practice. In this

instance the record indicates that Makita made the long term, if not

permanent, decision to shift its production of non-specialty PECTs to

the United States in 1993. Thus, while the sales levels prior to the

imposition of the order provide an appropriate benchmark for analyzing

sales volumes of specialty PECTs--this benchmark is no longer relevant

to sales volumes of non-specialty PECTs. As such, we have compared

Makita's sales volumes of specialty PECTs prior to the imposition of

the order with those in the post-order period and, as stated above,

after considering all relevant factors, found the latter to be

significant.

Additionally, as we stated in Pure Magnesium from Canada 2 at

50492, a sales drop-off after imposition of the order does not

necessarily prevent revocation. The Department explained:

The Department's threshold requirement does not mean, as NHCI

suggests, that the Department is effectively disqualifying companies

from revocation if there is a sales drop off following the

imposition of an antidumping order. The issue that is analyzed by

the Department is the magnitude of the drop-off. In this regard, the

Department has expressed its intent to revoke an antidumping duty

order even where the sales drop-off has been substantial so long as

the sales used to demonstrate a lack of price discrimination are

reflective of the company's normal commercial experience.

Thus, the normal concern that accompanies decreased sales (i.e.,

that a low level of sales activity does not provide a reasonable basis

for determining that the discipline of the order is no longer necessary

to offset dumping) is not present here because there is an explanation

as to why Makita has decreased sales of subject merchandise and current

sales levels are significant. Compare with Pure Magnesium from Canada

(where the Department could not reasonably conclude that the zero

margins received by respondent were reflective of the company's normal

commercial experience without the discipline of an order). For these

reasons, we find that we can reasonably conclude that the de minimis

margins calculated for Makita are reflective of the company's normal

commercial experience and provide a reasonable basis for our decision

to revoke. See August 2 Revocation Memorandum at 10-11.

Comment 2: Consideration of ``Changed Circumstances'' in the

Context of Revocation

The petitioner states that the Department has improperly collapsed

its revocation review pursuant to 751(a) of the Act with a changed

circumstance review pursuant to 751(b) of the Act. The petitioner

purports that the Department has done this without prior notice and

therefore does not have the authority to do so. Citing the Department's

August 2 Revocation Memorandum (at 4-5), the petitioner states that in

its preliminary results of this AR the Department concluded that

Makita's main argument supporting revocation is its ``changed

circumstance'' in subject merchandise production (i.e., Makita Japan's

substantial investment in a U.S. production facility--MCA--and its

PECT/power tool production shift from Makita Japan to MCA). The

petitioner argues that the Department has been careful not to conduct a

review under the guise of a changed circumstances review and that the

Department has always given notice in the Federal Register when it does

initiate a changed circumstance review (citing Carbon Steel Plate from

Korea: Final Results of Changed Circumstances Administrative Review and

Revocation of Antidumping Duty Order 51 FR 13042 (April 17, 1986); and

Certain Dried Heavy Salted Codfish from Canada; Initiation and

Preliminary Results of Changed Circumstances Administrative Review;

Consideration of Revocation; and Intent to Revoke Antidumping Duty

Order 54 FR 41479 (October 10, 1989)). Therefore, the petitioner argues

that by considering MCA as a factor for revocation, the Department is

effectively conducting a changed circumstances review without proper

notice, and is thus violating its statutory and regulatory obligations.

Makita states that the Department did not convert the revocation

proceeding to a changed circumstances proceeding. Makita stresses that

the fact that some of the Department's preliminary findings could also

have been used in a changed circumstances review does not turn the

revocation proceeding into a changed circumstances review. Makita notes

that at no point did the Department indicate that its decision to

revoke was based simply on ``changed circumstances.'' Rather, according

to Makita, the Department considered the establishment of MCA as a

relevant factor regarding Makita's normal business practices and its

applicability toward satisfying the commercial quantities threshold.

Department's Position: This administrative review has been

conducted under section 751(a) of the Act; it is not a ``changed

circumstances'' review under section 751(b). The difference between

these two types of proceedings is primarily procedural. A section

751(a) review is conducted any time the Department receives a request

for review in the anniversary month. Moreover, the regulations

specifically provide that, if certain criteria are met, parties may

request revocation at the time they request an administrative review

under section 751(a) (see 19 CFR 351.222(e)). In contrast, a 751(b)

review

[[Page 71418]]

is conducted any time the Department determines that there are changed

circumstances sufficient to warrant review. Revocation can also be

considered in the context of a 751(b) review (see 19 CFR 351.222(g)).

Although changed circumstances may warrant a review under section

751(b), nothing precludes the Department from considering facts

relating to changed circumstances in the context of a section 751(a)

review. In fact, the Department must consider all facts of record that

are relevant to an issue under consideration in a section 751(a)

review, whether it be an issue related to a margin calculation or to a

request for revocation. However, the character of the review does not

change simply because some of the facts considered relate to changes in

the way a company conducts business.

Makita's establishment of MCA and its subsequent transfer of

production to the United States is a relevant fact that cannot be

ignored in the Department's revocation analysis. Indeed this fact could

be characterized as a significant ``changed circumstance'' as was

stated in the preliminary results. This characterization of the record

facts, however, does not alter the nature of the proceeding. The

petitioner, who has participated throughout this 751(a) review, has

been afforded full notice and opportunity to provide evidence and

comment regarding the issue of revocation generally and the impact of

the shift in production specifically. The petitioner, in fact, has

commented extensively on these issues.

Comment 3: Five Percent Market Viability Test and Commercial Quantities

Determination

The petitioner argues that the Department's commercial quantities

determinations in the context of revocation should be consistent with

its policy in determining market viability under 19 CFR 351.404(b). The

petitioner states that the Department's five percent viability standard

is an appropriate benchmark to use because the requirement that NV be

based on home market (or third country market) sales of a certain

quantity and the commercial quantities standard are similar. The

petitioner states, based on this comparison, that sales quantities in

the U.S. market that are less than five percent of pre-order sales

should not be considered representative to calculate margins for

purposes of revocation.

Regarding the petitioner's argument that the Department's

revocation determinations should be consistent with its home market

viability determinations, Makita states that the five percent test for

home market viability is designed for an entirely different purpose and

has little applicability to the determination of commercial quantities

in revocation. According to Makita, given the many years (six years at

minimum) that typically intervene between the pre-order period and the

revocation determination, any fixed, pre-determined percentage would

not allow for significant changes in commercial practice. Additionally,

Makita purports that by rejecting home markets where the quantity of

sales is less than five percent of the U.S. export quantity, the

Department is in no way suggesting that such sales are not made in

commercial quantities.

Department's Position: We agree with Makita that the five percent

test for home market viability is not relevant to the determination of

commercial quantities in a revocation proceeding. The purpose of the

viability test is to identify the most appropriate market in which to

determine the NV of the subject merchandise, which is an issue that

must be decided very early in the proceeding. That issue lends itself

to a rule of general applicability and a general rule facilitates the

requisite early decision. In contrast, for revocation, the issue is

whether a company's sales during the three years in question provide a

reasonable and reliable basis for determining that continuation of the

order with respect to that company is no longer necessary to offset

dumping. This is a more complex issue and a threshold matter in the

context of the revocation decision. Thus, a general rule on the level

of sales is inappropriate; it is an issue that can only reasonably be

decided on a case-by-case basis.

Likelihood of Future Dumping

Comment 1: History of Dumping

The petitioner states that Makita's history of dumping, as

evidenced by the imposition of the antidumping duty order, illustrates

that Makita has to dump in order to compete effectively in the U.S.

market, and that Makita will resume dumping if the Department revokes

the order. The petitioner notes that Makita's drop in subject

merchandise sales since the imposition of the antidumping duty order

(i.e., in terms of total number of models, total number of units, and

loss of market share) has been substantial based on the Department's

preliminary analysis. Thus, the petitioner states that revoking the

order now would provide little commercial benefit to Makita unless

Makita intends to resume selling higher volumes of subject merchandise

in the United States at dumped prices.

The petitioner also argues that Makita will resume dumping subject

merchandise in the future if the order is revoked because Makita has

continued dumping non-subject tools (i.e., professional electric

sanding-grinding tools (``PESGTs'')). The petitioner purports that

Makita's normal pattern of production and trade are presumptively

reflected in its non-subject tool sales and therefore Makita's trade in

PECTs will match its trade in PESGTs if the order is revoked. Based on

its analysis of Makita's PESGTs sales, the petitioner maintains that

Makita has not stopped dumping its PESGTs in the U.S. market since the

time of the antidumping duty investigation (see pages 7-13 of the

petitioner's September 10, 1999, case brief).2 In addition,

the petitioner states that, based on Makita's admission, PESGTs are not

materially different from PECTs. According to the petitioner's

analysis, Makita has continued dumping its PESGTs at a 46 percent

margin during the PORs that are the subject of this revocation inquiry.

Therefore, the petitioner states that continued dumping of non-subject

tools provides a clear indication that Makita would likely resume

dumping subject merchandise if the antidumping duty order were revoked.

---------------------------------------------------------------------------

\2\ Note: PESGTs were investigated as subject merchandise during

the original less-than-fair-value investigation of PECTs. However,

the ITC determined that there was no material injury to the U.S.

industry for these products. Consequently, no antidumping duty order

was imposed on PESGTs from Japan.

---------------------------------------------------------------------------

Finally, the petitioner asserts that Makita has an incentive to

resume dumping of its low-sales-volume, specialty PECTs that it has

been importing into the United States during the pre- and post-order

periods. The petitioner states that Makita's sales of specialty PECTs

have decreased by 50 percent since 1992, as a result of increasing its

prices on specialty PECTs in response to the antidumping duty order.

Thus, the petitioner argues that there is incentive for Makita to

resume dumping of subject merchandise (i.e., specialty PECTs).

Makita disagrees, stating that the facts alleged by the petitioner

do not show any history of dumping by Makita, but only show a history

of accusations that Makita engages in dumping. Makita states that the

petitioner's allegation is not supported by any evidence in the record

because the Department has found that Makita has not dumped subject

merchandise for three years. Makita maintains that its losses in market

share are not compelling

[[Page 71419]]

evidence that it is likely to dump if the order is revoked, especially

since, in Makita's opinion, increases in the petitioner's U.S. market

share have resulted from predatory pricing techniques, which also

explain Makita's decreased market share. Makita states that its subject

merchandise sales business is not predicated on a particular market

share in order to effectively compete in the United States. More

importantly, Makita points out that most of its U.S. PECT sales are not

subject merchandise, but are U.S.-MCA-produced PECTs. Therefore, Makita

maintains that it does not need to dump its sales of subject

merchandise (i.e., low-sales-volume, specialty PECTs) in order to

maintain its U.S. market share because most of its PECTs for the U.S.

market are produced at MCA.

Further, Makita argues that the petitioner's assertion that

revocation will only benefit Makita by facilitating its resumption of

dumping is inaccurate. Makita states that revocation of the order will

have the following benefits: (1) Removal of the stigma associated with

being the subject of an antidumping duty order; (2) resumption of sales

to U.S. customers who will not purchase tools that are subject to an

antidumping duty order; and (3) elimination of expenses involved with

participation in the Department's administrative reviews. Thus, Makita

asserts the petitioner has presented no positive rebuttal evidence

which can overcome the presumption that, if the order is revoked, there

is no likelihood that Makita will resume dumping in the future.

Regarding the petitioner's argument that Makita's continued

``dumping'' of non-subject power tools is probative of future dumping

of subject merchandise, Makita contends it is unpersuasive because

Makita's sales of non-subject merchandise are irrelevant and outside

the scope of this proceeding. Makita argues that a comparison of its

subject merchandise sales with its non-subject merchandise sales is

nowhere recognized as a relevant test of any likelihood of future

dumping of subject merchandise. Makita purports that the petitioner

misrepresents Makita's comments regarding the distinctions between

PESGTs and PECTs. Makita states that it never claimed that there are no

differences between PESGTs and PECTs, but that there is a substantial

commonality in components, production machinery, manufacturing

processes, and assembly of the two tool categories. Thus, Makita

states, there are no relevant production-related distinctions between

PESGTs and PECTs that would prompt Makita to keep production of either

tool category in Japan or the United States. Makita contends that the

petitioner's argument which seeks to compare Makita's pricing and

production policies on PESGTs (non-subject merchandise) and PECTs

(subject merchandise) in the context of analyzing the likelihood of

future dumping of the latter, is not founded in Department precedent.

Thus, Makita states that the petitioner's argument lacks relevant

evidence rebutting the Department's presumption that Makita is not

likely to dump in the future.

Regarding the petitioner's argument that Makita is likely to resume

dumping of specialty PECTs to regain market share, Makita states the

following: (1) Its current sales volumes of specialty PECTs are not

inconsistent with its historical sales volumes; (2) it does not need to

lower the price of specialty PECTs because of its premium pricing

strategy; and (3) it has flexibility in the amounts by which it can

lower prices on specialty PECTs (should Makita choose to) before

dumping occurs. Specifically, Makita argues that its sales of specialty

PECTs have always been limited and have fluctuated from year to year.

Makita states that the record shows that it is engaged in premium

pricing of its specialty PECTs, where it restricts the supply of a tool

category in order to maintain its higher price quality image, but that

there is no evidence on the record showing that Makita intends to

regain market share through reduced prices. In addition, Makita states

that it has significant room in which to lower its specialty PECT

prices before dumping occurs and this shows that Makita has not

increased prices on specialty PECTs simply to avoid dumping.

Department's Position: We disagree with the petitioner's contention

that Makita's history of dumping PECTs, prior to the 3rd AR of this

proceeding, illustrates that dumping is a necessary part of Makita's

competitive position in the U.S. PECT market. As a threshold matter,

the Department's revocation analysis focuses on the three most recent

review periods. The Department generally finds that three consecutive

years of non-dumped sales in commercial quantities indicates that a

company will not dump in the future. See Corrosion-Resistant Steel from

Canada at 2175 (``in evaluating the issue of likelihood, the Department

has considered three years of sales in the United States with no

dumping margins, plus an agreement to reinstatement [of] the order, to

be indicative of expected future behavior.''). Thus, where there is no

evidence to the contrary, the Department will normally determine that

revocation is warranted. See also Furfuryl Alcohol From the Republic of

South Africa; Preliminary Results of Antidumping Duty Administrative

Review and Revocation of Antidumping Duty Order, 64 FR 10983, 10894

(March 8, 1999); Titanium Sponge from the Russian Federation:

Preliminary Results of Antidumping Duty Administrative Review and

Partial Revocation, 63 FR 47474, 47475 (September 8, 1998); and Steel

Wire Rope From the Republic of Korea: Final Results of Antidumping Duty

Administrative Review and Revocation in Part of Antidumping Duty Order,

63 FR 17986, 17988 (April 13, 1998) (hereafter Steel Rope from Korea).

Makita has satisfactorily established that it has sold subject

merchandise in commercial quantities at fair value for three

consecutive years. Absent evidence to the contrary, the Department

presumes that three years of de minimis or zero margins is indicative

of Makita's future behavior (see August 2 Revocation Memorandum at 11).

We also disagree with the petitioner's allegation that Makita's

continued dumping of non-subject power tools (including both U.S.-made

and Japanese-made non-subject merchandise) is probative of future

dumping of subject merchandise in this case. Generally, information

regarding non-subject merchandise is irrelevant to whether an existing

order continues to be necessary to offset dumping of the subject

merchandise. The information provided by the petitioner does not

warrant an exception in this case and thus cannot provide a basis for

rebutting the presumption established by three consecutive years of

sales of the subject merchandise at not less than fair value. Although

the petitioner did not submit its allegation regarding Makita's pricing

of non-subject merchandise in time for the Department to consider it

for purposes of the preliminary results, the Department preliminarily

indicated that pricing of non-subject merchandise might be a relevant

factor in its analysis and that it may consider the petitioner's

information for purposes of the final results (see August 2 Revocation

Memorandum at page 16). However, as discussed above, the Department

finds that in this case, the information on sales of non-subject

merchandise is irrelevant for purposes of this final revocation

determination. Therefore, the Department's revocation decision in this

case is based only on the facts related to the subject merchandise

sales alone.

The Department further disagrees with the petitioner's allegation

that Makita will resume dumping to regain lost share of the PECT

market. Evidence

[[Page 71420]]

on the record indicates that Makita has suffered continued losses in

its market share in the ``electric power tool market'' as a whole

(i.e., all electric power tools including subject PECTs--see Makita's

February 9, 1999, submission at Appendix 15). Therefore, if the

petitioner's rationale (i.e., dumping maintains market share) is to be

considered accurate, one would have expected Makita to have maintained

its market share in other categories of electric power tools, which the

petitioner contends Makita has continued to dump, while only losing

market share in PECTs. This in fact is not the case, as Makita has lost

market share in other electric power tool categories as well. Thus, it

is clear there are other factors that impact a competitor's position in

the market (e.g., introduction of a new competitor, innovations,

reputation). Therefore, we agree with Makita that its sales of subject

merchandise are not predicated on a particular market share in order to

effectively compete in the United States.

Comment 2: Home Market Demand

The petitioner states that declining home market sales and home

market demand (i.e., decline in the Japanese electric power tool market

and Japanese housing starts from 1997-1998), coupled with rising demand

in the United States, have increased the likelihood that Makita will

dump PECTs in the U.S. market in the future. The petitioner submits

that the evidence in the record contradicts the Department's finding of

market stability in Japan. Therefore, the petitioner maintains that

with Makita's declining sales in the home market, Makita has greater

incentive to direct its PECT sales to the U.S. market.

Makita stresses that although there have been fluctuations in its

home market electric power tool sales and Japanese housing starts, the

petitioner is confusing short-term fluctuations in an otherwise

relatively stable home market with a permanent decline in demand for

electric power tools (i.e., from 1992 to 1997). In addition, Makita

states it has no incentive to increase exports from Japan because most

of its tools sold in the U.S. market are produced in the United States

(i.e., MCA), and that its focus is to increase production at MCA rather

than increase production in Japan. Moreover, Makita states that it has

many other viable markets, other than the United States and Japan,

where Makita Japan sells its cutting tools, thereby reducing its

financial dependance on Japanese exports to the United States.

Furthermore, Makita maintains that it would not be practical for Makita

Japan to export subject merchandise that would, in effect, be competing

with MCA's production of PECTs.

Department's Position: We agree with Makita that a stable home

market does not require an absence of market fluctuations, and that the

evidence on the record pertaining to the health of the Japanese home

market does not suggest that Makita is likely to dump PECTs in the U.S.

market in the future if the order were revoked. Although the petitioner

claims that the Japanese power tool market is in decline, we find that

the record data indicates that the market in Japan is relatively stable

(see August 2 Revocation Memorandum at 14). We do not conclude that the

drop in housing starts in Japan and home market demand for subject

merchandise between fiscal year (``FY'') 1996 and FY 1997 indicates a

declining or unhealthy market. Rather, we would expect even a healthy

market, especially the electric power tool market, to experience both

peaks and troughs in demand. Contrary to the petitioner's assertion, we

have no evidence that suggests that the above mentioned one-year

decline in the Japanese power tool market is a long-term occurrence.

Therefore, based on the evidence as a whole, we find the Japanese power

tool market to be relatively stable.

In addition, the record supports Makita's assertion that it is

unlikely to increase its PECT exports from Japan to the United States

to pre-order levels because most of its tools sold in the U.S. market

are now produced in the United States by MCA. This conclusion is

particularly evident when reviewing Makita's production capacities in

both the U.S. and home markets, i.e., Makita has substantial excess

capacity available in the United States and is producing at full

capacity in Japan. (See Comment 3 of this section below for further

discussion.) Furthermore, it is unlikely that Makita Japan will resume

its pre-order export levels of subject merchandise because such exports

would be competing with MCA's production of PECTs, or would require

costly shifts in PECT production back to and restructuring of capacity

utilization in Japan (see the Department's July 9, 1999 verification

report at 22-23, 34-36; and July 13, 1999 verification report at 4-7).

Finally, we verified that Makita has other viable markets, other than

the United States and Japan, wherein Makita Japan can sell its cutting

tools (see the Department's July 9, 1999, verification report at 36-

40). Thus, Makita Japan is not dependant on Japanese exports to the

United States for financial viability. As such, based upon the data on

the record regarding the Japanese and U.S. PECT markets, the existence

of Makita's U.S. production facility, the available or lack of

available production capacity levels in MCA and Makita Japan (i.e.,

Okazaki plant), respectively, and Makita's healthy sales history in

other world markets, we find that the sales pattern in the Japanese

home market does not suggest that Makita is likely to resume dumping of

PECTs in the United States without the discipline of the order.

Comment 3: PECT Production in Japan Versus the United States

The petitioner purports that Makita Japan could increase its

production output with relative ease and despite its reported capacity

utilization figures and thereby increase production of PECTs for sale

in the U.S. market at dumped prices if the order is revoked. The

petitioner argues that plant capacity is unrelated to production output

because the annual production output at Makita's Okazaki plant has

increased nearly 100 percent from 1992 through 1997, while its capacity

utilization has remained constant during the same time period.

Furthermore, the petitioner suggests that the Department has ignored

its claim regarding the ease with which an electric power tool

manufacturer can expand production. (See Declaration of Ronald S.

Taylor, Black & Decker February 24, 1999, submission.) Finally, the

petitioner argues that a manufacturing plant (i.e., Makita's Okazaki

plant) with easily modifiable assembly lines does not face the same

barriers to expansion and conversion as other complex, more capital-

intensive facilities with fixed, dedicated, and expensive equipment.

Thus, the petitioner asserts that Makita's capacity in Japan can be

easily and relatively inexpensively altered, resulting in increased

PECT production in Japan for sale in the U.S. market at dumped prices

if the order is revoked.

The petitioner also states that Makita USA's consolidated financial

statements show poor performance for FYs 1997 and 1998 3 and

Makita's U.S. production facility MCA has utilized less than two thirds

of its total production capacity. The petitioner argues that Makita's

U.S. operations are a drain on the Makita corporation and that

continued poor financial performance of Makita's U.S.

[[Page 71421]]

operations will render Makita's capital investments in MCA moot.

---------------------------------------------------------------------------

\3\ The financial statements for Makita USA (Makita Japan's

affiliated selling agent in the United States) and MCA (Makita's

U.S. production facility) are consolidated for financial reporting

purposes in the United States. The Makita USA/MCA consolidated

financial statement is consolidated into Makita's overall corporate

financial statement as well.

---------------------------------------------------------------------------

In addition, the petitioner states that the downward trend in the

yen against the U.S. dollar (i.e., depreciation of the yen against the

dollar) suggests that production in Japan is and will become more

profitable than production in the United States based on its estimation

of Makita's cost of manufacturing in the United States verses Makita's

cost of manufacturing in Japan. The petitioner argues that Makita would

have increased its profits if Makita would have shifted its production

back to Japan (see the petitioner's September 17, 1999, case brief at

18-19 and at Exhibit 6). Finally, the petitioner asserts that Makita's

loss in U.S. market share gives Makita a financial incentive to

concentrate its production of cordless tools (i.e., PECTs) in Japan.

Specifically, the petitioner claims that Makita has not participated

meaningfully in the U.S. market for cordless saws, which are currently

produced by MCA. Because cordless tools are not affected by voltage

differences, the petitioner argues that if the order is revoked Makita

will consolidate its cordless saw production in Japan in order to take

advantage of its economies of scale and production experience in Japan.

The petitioner argues further that Makita will have to adopt measures

to regain market share which will include a resumption of subject

merchandise sales at dumped prices, particularly in the popular and

growing cordless PECT market. Thus, the petitioner asserts that Makita

USA's poor financial performance, favorable currency fluctuations, and

losses in U.S. market share all give Makita an incentive to resume

dumping in the United States should the order be revoked.

Makita asserts that the Department correctly concluded that Makita

Japan operates at the upper limit of the maximum volume that can be

produced by its Japanese facility. Makita states that because it closed

down its Anjo, Japan production facility and moved a portion of Anjo's

production capacity into the Okazaki plant in 1997, the Department must

consider the distinctions between Makita's prior and current production

capacities, namely, its past capacity when its Okazaki and Anjo plants

were open and producing PECTs in comparison to its current capacity

where only a single plant (i.e., the Okazaki plant) is producing PECTs.

Makita argues that when recognizing such significant differences, it is

clear that the closing of the Anjo plant significantly reduced its

production capacity and Makita Japan's ability to expand its capacity.

Makita argues further that whether or not it can set up new

assembly lines in its Okazaki plant is not relevant to this segment of

the proceeding. Makita states that assembly of new lines involves the

construction of new capacity and not the utilization of current

capacity. Makita maintains that in this segment of the proceeding the

Department's focus should be whether Makita has idle capacity currently

available to increase the output of subject tools for export. Makita

states that evidence on the record suggests that no such additional

capacity is available in Japan.

Regarding the petitioner's allegation that the Department has not

considered the affidavit of Ronald S. Taylor, regarding the ease with

which assembly lines can be added to Makita's Okazaki production plant,

Makita states that the statements made in the affidavit are not

applicable to Makita's business practices for the following reasons:

(1) Makita's Okazaki plant does not have the floor space to add

production; (2) substantial increases in capacity in Japan would

include re-opening the Anjo facility and a reduction in capacity at

MCA; and (3) returning production to Japan would be costly and

difficult to implement. Thus, Makita argues that transferring

production from MCA back to Japan is neither easy nor inexpensive, and

that the affidavit does not fully address Makita's commercial situation

because Makita's long-range business strategy includes the shifting of

production closer to its international markets.

Furthermore, Makita argues that Makita USA is on the road to

profitability and that MCA's operations have been profitable in 1997

and 1998. Makita argues that Makita USA's poor financial performance in

FYs 1997 and 1998 and MCA's low capacity utilization does not support a

return of production to Japan, but rather a reinforcement of its

efforts to increase production at MCA (noting that Makita has made a

substantial investment in MCA). In addition, if Makita's only business

concern was cost of production, then, Makita states, it would be far

more sensible for it to shift its production to the People's Republic

of China where it already has a production facility rather than Japan.

Makita argues that Makita USA's poor financial performance is not

unexpected in a situation where a still-expanding U.S. subsidiary

(i.e., MCA) is operating below its capacity. Makita asserts that MCA is

still growing toward its role as the main provider of electric power

tools in the U.S. market and that Makita's continued investment in the

facility indicates Makita's continued commitment to expand MCA's role

in the U.S. market. Thus, Makita contends that the establishment and

strengthening of MCA is a long-term investment project on which it does

not expect an immediate return.

In addition, Makita maintains that only when the value of the

Japanese yen is decreasing against the U.S. dollar do currency

fluctuations make its Japanese operations more profitable than its

operations in the United States. Makita states that MCA was

established, at least in part, in order to avoid dependancy on exchange

rate fluctuations and the risks associated with them. Makita argues

that the time frames (i.e., June 1993 and June 1998) that the

petitioner cites in its analysis were periods when the yen was weak

against the dollar, but that in June 1995 and September 1999 when the

yen was stronger, Makita's U.S. operations were more profitable.

Notwithstanding these facts, Makita states that it has never

conditioned its long-term strategy on short-term currency fluctuations,

but on the premise that Makita is best served by eliminating the risks

associated with the unpredictability of fluctuating exchange rates and

by moving production from Japan to its local markets.

Finally, Makita states that the petitioner's argument that Makita

has financial incentive to consolidate its production of electric power

tools in Japan, particularly cordless PECTs, is based on the

petitioner's incorrect assumption that Makita does not already produce

cordless PECTs in the United States. Makita notes that it has been

producing cordless PECTs at MCA for years, and has never found that

production would be facilitated or improved if it was shifted back to

Japan. Makita argues it has not forfeited its share of the U.S.

cordless PECT market, but rather it has taken full advantage of the

opportunity by establishing efficient operations that are close to its

customer base in the U.S. market. Makita states that the petitioner has

not presented any evidence supporting the argument that consolidation

of cordless tool production in Japan would be more cost effective.

Department's Position. We agree with Makita that the record

indicates an intent to maintain and/or increase production operations

in the United States without increasing production in Japan. The record

indicates that Makita has limited unutilized capacity in Japan, but

available capacity in the United States. Makita's verified submissions

demonstrate that Makita's facility in Okazaki, Japan (Makita's only

remaining production facility for PECTs in Japan) is currently

operating at full capacity,

[[Page 71422]]

and has been doing so since 1991. Two important facts that were

considered in analyzing production capacity at the Okazaki plant are

(1) the Okazaki plant (and the Anjo plant when it was open) has

operated with two shifts only since 1996, and thus the Okazaki plant's

capacity utilization figures were based on one production shift prior

to 1996; and (2) Makita closed down its Anjo production facility and

moved a portion of Anjo's production capacity (i.e., production

equipment including armature winding lines, assembly lines, armature

shaft hardening machines) into the Okazaki plant in 1997, thereby

bringing the Okazaki plant to its optimal production capacity. The

addition of a production shift explains how Makita's Okazaki plant was

able to increase its total annual production nearly 100 percent from

1992 through 1997, while its annual capacity utilization remained

constant. Additionally, we verified that it would be difficult, if not

impossible, for Makita to add a third shift in its Okazaki plant (see

August 2 Revocation Memorandum at 14). In sum, comparing Makita's

production capacity and total annual output when its Okazaki and Anjo

plants were open and producing electric power tools with one shift

each, with Makita's current production capacity and annual output at

the Okazaki plant producing electric power tools with two shifts (see

Appendix 4 of Makita's September 17, 1999, rebuttal brief and

verification exhibit 13 of the Department's July 9, 1999 verification

report), the Department finds that Makita Japan's total annual

production output at the Okazaki plant using two production shifts

since 1997 is comparable to Makita Japan's previous total annual

production output at the Anjo and Okazaki plants using one production

shift in each plant prior to 1997. In short, from 1992 through 1998,

Makita Japan's annual production of electric power tools for each shift

reflected Makita Japan's optimal capacity utilization. Thus, Makita

Japan's production with two shifts at one plant (i.e., Okazaki plant)

is comparable to Makita Japan's production with one shift at each of

the two plants (i.e., Okazaki and Anjo plants).

We further note that although Makita USA's financial statement

reports a poor performance for 1997 and 1998, the MCA plant operated

profitably in 1998 (see the Department's July 13, 1999, verification

report at 10 and 11, and verification exhibit 12). Moreover, there is

nothing on the record to indicate that the entire financial loss is

directly related to Makita's U.S. production of PECTs. Indeed, the

Department recognizes there could be a number of explanations for

Makita USA's poor financial performance in 1997 and 1998 (e.g.,

accounting policies, long-term investment strategies, failed business

ventures). There is nothing on the record indicating specifically what

the losses are attributable to and, where the U.S. production operation

has been profitable in 1998, the Department cannot make an assumption

that the corporation would choose to cease such operations in order to

increase profitability for a related entity. Additionally, Makita's

statement regarding the expected growth of MCA provides a reasonable

explanation for any losses incurred, i.e., MCA is still growing toward

its role as the main provider of electric power tools in the U.S.

market and Makita continues to invest in the facility (see the

Department's July 13, 1999, verification report at 9 and verification

exhibit 12); thus it is reasonable to conclude that building up MCA is

a long-term undertaking and Makita does not expect an immediate return

on its investment.

Additionally, the record supports and we accept Makita's

characterization as to the effect of currency fluctuations on Makita's

decision to maintain production of PECTs at MCA (see Makita's September

17, 1999, rebuttal brief at 31-33). Given the many factors that can

affect profitability during a time of currency depreciation, we cannot

determine which operations (i.e., Makita's Japanese operations or

Makita's U.S. operations) will be more profitable as the petitioner

suggests. However, a depreciation of the yen does not imply that

dumping will occur. To the contrary, the Department notes that during a

period of a depreciating home market currency, there is even less

pressure to engage in pricing below NV. In this proceeding, there is no

evidence on the record indicating the likelihood of a resumption of

dumping due to the effect of a long-term depreciation of the yen

against the dollar, which by itself does not indicate a likelihood of

sales at less than fair value. See Steel Rope from Korea at 17988.

Furthermore, Makita has demonstrated that there are a number of long-

term business advantages in establishing a U.S. production facility

including: (1) Makita's ability to avoid dependancy on exchange rate

fluctuations and the risks associated with them; and (2) Makita's

ability to respond to the needs of the U.S. market in a more timely

fashion. Finally, evidence on the record supports Makita's long-term

business practice of moving production from Japan to Makita's electric

power tool markets abroad (see the Department's July 9, 1999,

verification report at 22-23 and verification exhibit 6A).

Comment 4: Pricing Practices With Respect to Subject and Non-Subject

Merchandise

The petitioner states that Makita's inability to undercut its U.S.

competitors' prices with respect to PECTs it produces in Japan, coupled

with its widespread undercutting of prices on U.S.-made PECTs and other

non-subject tools, indicates the effectiveness of the order and the

likelihood that Makita would resume dumping if the order were revoked.

The petitioner states that if it were not for the order, Makita's

prices for specialty PECTs imported from Japan would be lower than

those of Makita's competitors. Therefore, the petitioner argues that by

forcing Makita to maintain high prices, the order has resulted in

Makita's devastating loss of U.S. market share in PECTs, and that

Makita will have to lower its prices on PECTs as soon as the order is

lifted in order to regain its lost market share.

Makita states that it has considerable room for dropping the price

on its subject merchandise sales without incurring a dumping liability.

Makita argues that it has not been forced to maintain higher prices on

its Japan-made specialty PECTs due to the impact of the order, but has

chosen not to lower its prices for marketing purposes (i.e., Makita's

marketing strategy entails producing a higher quality product that

demands higher prices). Thus, Makita states that higher pricing is the

result of its business strategy rather than the result of the impact to

the antidumping duty order.

In addition, Makita argues that it has not undercut the

petitioner's prices with respect to its U.S.-produced PECTs, and that

Makita has in fact experienced drops in its market share of non-

subject, U.S.-produced PECTs. Makita states that of the thousands of

U.S.-produced PECT sales made every month, the petitioner has found

only 10 PECT models on which to base its allegation of price

undercutting. Makita argues that even if the petitioner's allegation

were correct, the small number of tool models cited would amount to a

de minimis margin. In response to the petitioner's allegation that

market share is gained through undercutting competitors' prices, Makita

reasons that if it had undercut its competitors' prices with its U.S.-

produced PECTs, then it should have increased its share of the U.S.

PECT market rather than lost it (as is the case since 1992). To the

contrary, Makita

[[Page 71423]]

purports that petitioner undercuts Makita's prices in every case of

which Makita is aware.

Department's Position: We disagree with petitioner. Regarding the

petitioner's argument that Makita would undercut U.S. competitors'

prices on PECTs if the order were revoked, the Department generally

finds that three years of no dumping is predictive of future behavior.

(See Corrosion-Resistant Steel from Canada, at 2175. Thus, where there

is no evidence to the contrary, the Department will normally determine

that continuation of the order is no longer necessary to offset

dumping. Further, because Makita has agreed to reinstatement of the

order in the event of future dumping, it is inappropriate to presume

that the imposition of the order is the only factor preventing dumping.

Rather, we considered other factors that might suggest a likelihood of

future dumping as discussed in the ``Determination to Revoke the Order

in Part'' and ``Likelihood of Future Dumping'' sections in this notice

above.

Regarding the petitioner's argument that Makita's widespread

undercutting of prices on U.S.-made PECTs and other tools is indicative

of Makita's behavior in the absence of an order, the Department

reiterates its position enumerated above in Comment 1 of the

``Likelihood of Future Dumping'' section of this notice. We disagree

with the petitioner's allegation that the pricing of non-subject

merchandise in this case is probative of whether the order continues to

be necessary to offset dumping of subject merchandise.

Final Results of the Review

We determine that the following weighted-average margin for Makita

exists for the period July 1, 1997, through June 30, 1998:

Manufacturer/producer/exporter: Makita Corporation Incorporated

Margin (percent): 0.07 percent (de minimis)

Effective Date of Revocation

This revocation applies to all entries of subject merchandise that

are produced by Makita Japan and that are also exported by Makita

Japan, entered, or withdrawn from warehouse, for consumption on or

after July 1, 1998. The Department will order the suspension of

liquidation ended for all such entries and will instruct the Customs

Service to release any cash deposits or bonds. The Department will

further instruct Customs Service to refund with interest any cash

deposits on entries made after June 30, 1998.

Assessment

The Department shall determine, and the Customs Service shall

assess, antidumping duties on all appropriate entries. The Department

will issue appraisement instructions directly to the Customs Service.

For entries of subject merchandise that are produced by Makita Japan

and that are also exported by Makita Japan, entered, or withdrawn from

warehouse, for consumption during the POR (i.e., July 1, 1997-June 30,

1998), the Department will instruct the Customs Service to liquidate

entries without regard to antidumping duties. The Department will order

the suspension of liquidation ended for all such entries and will

instruct the Customs Service to release any cash deposits or bonds with

interest if applicable.

Cash Deposit Requirements

The following deposit requirements shall be required for

merchandise subject to the order entered, or withdrawn from warehouse,

for consumption on or after the publication date of this final results

of the administrative review, as provided by section 751(a)(1) of the

Act: (1) the cash deposit rate for Makita Japan will be zero, except

that for imports of PECTs that are produced by Makita Japan and that

are also exported by Makita Japan, cash deposits will no longer be

required and the suspension of liquidation will cease for entries made

on or after July 1, 1998; (2) if the exporter is not a firm covered in

this review or the less-than-fair-value (``LTFV'') investigation, but

the manufacturer is, the cash deposit rate will be that established for

the most recent period for the manufacturer of the merchandise; and (3)

if neither the exporter nor the manufacturer is a firm covered in this

review or the LTFV investigation, the cash deposit rate will be 54.5

percent, the ``all others'' rate made effective by the LTFV

investigation. These requirements shall remain in effect until

publication of the final results of the next administrative review.

Notification to Importers and Interested Parties

This notice serves as a final reminder to importers of their

responsibility under 19 CFR 351.402(f) to file a certificate regarding

the reimbursement of antidumping duties prior to liquidation of the

relevant entries during the review period. Failure to comply with this

requirement could result in the Secretary's presumption that

reimbursement of antidumping duties occurred and the subsequent

assessment of double antidumping duties.

This notice also serves as a final reminder to parties subject to

APO of their responsibility concerning the disposition of proprietary

information disclosed under APO in accordance with 19 CFR 351.105(a).

Timely written notification or conversion to judicial protective order

is hereby requested. Failure to comply with the regulations and terms

of the APO is a sanctionable violation.

This determination is issued and published in accordance with

sections 751(a)(1) and 777(i)(1) of the Act.

Dated: December 8, 1999.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 99-32673 Filed 12-20-99; 8:45 am]

BILLING CODE 3510-DS-P